You are in > manchesterpropertyguide.co.uk > news

Fears for homeowners as interest rates go up

06/07/2007

Homeowners in Greater Manchester face a fresh round of higher mortgage payments following the Bank of England's decision to raise interest rates by 0.25 per cent.

The cost of borrowing is now at a six-year high and the latest move is the fifth increase since August 2006, thereby bringing rates to 5.75 per cent.

Experts at the Royal Institution of Chartered Surveyors said that households who are coming to the end of their fixed-rate deals face a big increase in their monthly payments.

"Someone with a £100,000 mortgage who is coming off a two-year fixed-rate deal in the next few months will face an increase of around £100 in their monthly repayments," a spokesman said.

However, other commentators believe that the decision to raise rates will cause soaring housing market inflation to slow down, making it easier for first-time buyers to find an affordable home.

Miles Shipside, of the property website Rightmove, said: "This further increase in interest rates, combined with the onset of the summer holiday season, means sellers must price more aggressively to attract buyers."

There is a consensus among economists that the Bank will raise interest rates to six per cent before the year's end, effectively ending the cheap borrowing boom.

© Adfero Ltd

THINKING OF INVESTING IN PROPERTY IN MANCHESTER?

Residential Property In Manchester

Click here to register for ALL residential property for sale in Manchester.
or click here to register for ALL residential property to let or rent in Manchester.

Manchester Commercial Properties

Click here to register for ALL commercial property for sale in Manchester.
or click here to register for ALL commercial property to let, rent or lease in Manchester.